Why Public Interest Trumps Trade Secrecy

from the what-the-frack? dept

Most companies have a natural tendency to keep details of their activities secret -- the fear being that competitors might be able to exploit for commercial advantage the information that they obtain. But it may be in the public interest for some details to be released, even if this might prove inconvenient for the company concerned. That's the background to a letter sent by ten law professors, including Larry Lessig, to the Alaska Oil & Gas Conservation Commission, pointed out to us by infojustice.org.

We, the undersigned law professors who teach and write about intellectual property and trade secrets, write in support of the Alaska Oil and Gas Conservation Commission (AOGCC) proposed hydraulic fracturing regulations that would provide for the disclosure of information that might in other contexts be deemed trade secrets that cannot be disclosed to the public, under proposed regulation 20 ACC 25.283(h).

While businesses engaged in hydraulic fracturing may have legitimate trade secrets, the public's interest in assuring that hydraulic fracturing is managed in a manner that addresses all significant risks may legitimately outweigh commercial concerns. To impede debate and discussion of the use of public natural resources in the name of commercial secrecy is to put commercial interests above the prior and more general interest in careful stewardship of the environment.

Put simply, some trade secrets must give way when broader public interests are at issue.

The letter offer three reasons why they support the new regulations calling for disclosure of information that might otherwise be regarded as confidential.

First, it is a basic principle in a democracy that the public shall conduct informed debate and discussion of public matters.

Without the facts, it's not possible to have a meaningful debate about important issues, which undermines the entire premise of democratic decision making.

Second, effective environmental management requires broad disclosure of specific data that describes any discharges into the environment -- including chemical identity, volume and locations of each chemical discharged -- and data on health and ecological effects.

Without detailed information about chemicals that are being used it is hard, if not impossible, to deal with any problems they cause. The letter quotes the following disturbing example:

in 2009, Cathy Behr, a nurse in Colorado, fell seriously ill after treating a worker who had been injured in a chemical spill. Her doctors diagnosed chemical poisoning, but the manufacturer of the product she was exposed to would not disclose its full ingredients, because it considered them proprietary. Ms. Behr has partially recovered, but she continues to have respiratory problems.

That certainly seems a pretty extraordinary state of affairs -- that someone should be unable to find out what she was exposed to in the course of her work, purely because a company deems it confidential information, and she is thus forced to live with the uncertainty of what the long-term consequences might be.

Third, trade secrecy law should not be used as a means to impede public access to EHS [environmental, health and safety] information.

That's because trade secrecy law is purely about keeping secrets from competitors: it is not about limiting access for other reasons, notably those of public health and safety. As the letter points out:

Trade secret law does not and should not exempt a firm from participation in the larger legal system, including warning and harm
prevention.

In a sense, trade secrecy law only applies insofar it does not conflict with broader principles of law, such as the preservation of public health or the environment. The present case involving fracking usefully highlights that contrast, but it is always present, even in less contentious areas.

Reader Comments

Ah, a subject I care about a lot

Now this is something I hope generates a lot of interest here and elsewhere. One of the reasons so many citizens are opposed to fracking is that they don't know what is going on around them. The secrecy only reinforces their wariness. As fracking moves into heavily populated areas, next to homes, schools, parks, and the like, people are going to ask to know what risks there are.

Re:

How to draw the line

I sincerely believe that trade secrets should be the replacement to the patent system. It works, look at Coke.

I also believe that trade secrets are abused, as in the examples given, and others.

Therefore the issue becomes about what information a company may protect. Should they be allowed to refuse disclosure of a formula that will poison something or someone? Should the drug companies be able to refuse disclosure of ALL test results, not just the ones that make their case?

Public or private, there needs to be a way to force disclosure of things that impact neighbors, or customers, or suppliers, or, for that matter, Mother Earth. (We currently have a weak (mesh quantum physics with the demanded dimensions that are unknown) understanding of the physical world. Why should we believe current engineers who say fracking is safe and wont hurt the water table or cause earthquakes or whatever.

The stuff companies will need to keep quiet under a trade secret only system will be their development plans and actions, not what they release into the wild, or like fracking companies, start doing it. The ability to be first to market, listen to the marketplace, maintain innovation, and maintain the cycle of great new products into the stream (quietly until its public) will be the keys.

Re: How to draw the line

I sincerely believe that trade secrets should be the replacement to the patent system

I don't.

Trade secrets predate patents. The patent system was intended to reduce the harm caused by everyone keeping their discoveries and inventions a secret: that the knowledge gained is never actually introduced to society at large and gets lost. Patents encourage sharing discoveries so they can be built on by others.

Our current patent system has major, major problems. But in my opinion the idea behind patents is a good one, and keeping everything a secret would be a great loss to everybody.

Re: Re: Re: How to draw the line

For instance, if Microsoft actually had valid patents against what Google is doing in Android, then it would be a perfect example of how patents are supposed to work. Google uses Microsoft inventions (like FAT32, for instance) and Microsoft makes a small amount of money for the use of their invention.

But since they refuse to disclose the patent numbers, it would seem that they are trolling.

This from an activist:
It is that disobedience, of entire communities sitting at lunch counters demanding to be served, that is our only hope of salvation in a world increasingly commandeered by a small handful of corporate decisionmakers intent on remaking the world as their own, he said. A revolution that subordinates the powers and rights of corporations to the rights of people and nature now waits in the wings.

Re: Great idea! Let's apply it to Google!

"While businesses engaged in hydraulic fracturing may have legitimate trade secrets, the public's interest in assuring that hydraulic fracturing is managed in a manner that addresses all significant risks may legitimately outweigh commercial concerns. "

in 2009, Cathy Behr, a nurse in Colorado, fell seriously ill after treating a worker who had been injured in a chemical spill. Her doctors diagnosed chemical poisoning, but the manufacturer of the product she was exposed to would not disclose its full ingredients, because it considered them proprietary. Ms. Behr has partially recovered, but she continues to have respiratory problems.

Its likely that the trade secrets are environmentally sensitive information on operations or chemicals used and the quantities or practices involved might bring others to harm.

Agreement that disclosure of basically everything is required before any hearings can proceed. The should just toss out the case/proposal. If they don't want to talk about it then fine but please go away and don't ask for anything.

If anyone wants a license or permit then please submit detailed operations and environmental impact studies. There have been a lot of complaints about fracking so something must be bad about it. Its normal to want to know more with research about it.

Re:

What is purpose of patents then?

Those drugs are patented, your competitors should not be able to do it already, so what is the point of all the secrecy?
Easier would be to strip the patents of those drugs since they were not fully disclosed.

Sounds like there will soon be a bill introduced to authorize the continued secrecy which cloaks the fracking industry, it will become commonly known as the Frag Gag Bill.

No worry, the folks over in oil and gas have an outstanding safety record and would never endanger the lives of those in the communities they serve. If an incident would to ever occur, they would be the first to offer assistance to those affected and would be very forthcoming with information updates - there would no cover up at all. Trust us.